Mary Jo White: One Size Does Not Fit All in Equity Markets

mary jo white November 2015SEC Chair Mary Jo White reaffirmed her interest in providing improved liquidity for shares in smaller companies mentioning specifically Reg A+ and Reg CF. In a wide-ranging speech on equity market structure, White injected a “word on quality markets for smaller companies.”

White stated;

“…I would be remiss if I did not mention another guiding principle of market structure – one size does not fit all.  So far, I have been talking about how the Commission intervenes in market structure to constrain practices that can be harmful for investors and issuers.  But building a quality market for smaller companies is a different beast – it requires innovating new business models and practices, and there the private sector must largely lead the charge.’

White continued to address the trading pilot regarding tick sizes – a move that may help improve liquidity for thinly traded shares. But she recognized that more needed to be done;

“I agree with many observers, however, that a change in tick size, even if it were to prove highly beneficial, is not likely to fully address the needs of smaller companies and their investors.  In short, our work here is not complete, even after implementing all of the rules required by the JOBS Act and creating new paths to capital for small issuers through Regulation A+ and crowdfunding.”

The subject of a “venture exchange” or “venture markets” has been a consistent theme for Chair White. She has been an avid observer and participant in the discussion. But while here comments are encouraging time may be running out on her tenure as Presidential elections are just around the corner and there are no guarantees she will remain at the SEC beyond 2017.

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